IAG/Aer Lingus
Thread Starter
Join Date: May 2011
Location: Hampshire
Age: 76
Posts: 821
Likes: 0
Received 0 Likes
on
0 Posts
IAG/Aer Lingus
It seems Aer Lingus has rejected a takeover bid by IAG:
BBC News - Aer Lingus rejects takeover bid by BA owner IAG
I'll bet they will be back.
BBC News - Aer Lingus rejects takeover bid by BA owner IAG
I'll bet they will be back.
Being reported this side of the ditch too.
Aer Lingus rejected IAG takeover approach on value terms
IMHO, it seems IAG are just looking for more Heathrow slots. I cannot see any other business case for EI existing within the IAG stable.
Aer Lingus rejected IAG takeover approach on value terms
IMHO, it seems IAG are just looking for more Heathrow slots. I cannot see any other business case for EI existing within the IAG stable.
Join Date: Jun 2011
Location: London, UK & Europe
Posts: 2
Likes: 0
Received 0 Likes
on
0 Posts
Suspect Walsh is worried at the recent developments at EI and how they are impacting on BA. Just geos to show that the big 3 European carriers can't compete with many carriers because of their cost bases!
He is not that stupid to make a bid purely for LHR slots as he knew they would be off the table straight away.
He will be back!
He is not that stupid to make a bid purely for LHR slots as he knew they would be off the table straight away.
He will be back!
Join Date: Jan 2013
Location: Dublin
Posts: 11
Likes: 0
Received 0 Likes
on
0 Posts
I would imagine that Aer Lingus being among the top three airlines transferring passengers to/from IAG, might be the reason that IAG would not want that business to go elsewhere...simple logic. Ryanair specialises in point to point sales, therefore no bias towards IAG.
Join Date: May 2011
Location: Ireland
Posts: 192
Likes: 0
Received 0 Likes
on
0 Posts
Yes, a lot of transfers to BA via Heathrow but also a lot to KLM and other Far Eastern airlines via Schiphol. Also Eithad and Emerites have taken business from BA since they started from Dublin.
Originally Posted by Una Due Tfc
I wonder if there's an element of WW trying to fill in that chip in his shoulder. IIRC, he left EI a a very frustrated man.
Ahern refuses to withdraw comment about Willie Walsh | BreakingNews.ie
I recall watching news footage on the day when Ahern stood up in the Dáil (Parliament) and denounced the Aer Lingus management for offering to purchase the company as the process was being dragged out by delaying tactics. It was pretty shocking stuff, given that it was believed that the government was actively delaying the process in order to protect votes in the constituency around Dublin Airport.
Beyond that, I still can't see a business case for IAG to purchase a small European operator such as EI. Apart from the Heathrow slots what does it add to the IAG offering? There's no large demographic catchment, no unique routes or special access arrangements. Very little, if anything by way of "synergies". Sure EI feeds some traffic into Heathrow, but IAG don't need to buy it to protect the traffic. To my mind it can only be one of two business propositions; a) to own & use the slots or b) to prevent someone else getting them. At a stretch, I suppose one could argue the case that it grows market share in Europe and is a step on the long heralded consolidation in the industry. If the model in the US is the template then it's arguable that isn't necessarily a good thing either.
JAS
Join Date: May 2012
Location: London
Posts: 122
Likes: 0
Received 0 Likes
on
0 Posts
IAG is not the sort of organisation to make an opportunistic bid, so I assume it's done its homework.
I can see a lot of logic in utilising EI's hub in Dublin to reinforce IAG's presence on the transatlantic market.
That said, IAG should really also be looking to boost its presence in markets where it is relatively weak (Asia for example).
I can see a lot of logic in utilising EI's hub in Dublin to reinforce IAG's presence on the transatlantic market.
That said, IAG should really also be looking to boost its presence in markets where it is relatively weak (Asia for example).
I thought Lufthansa might have been more interested than IAG, they have the second highest number of slots at LHR don't they? AF/KLM have far too many problems to be interested in adding to that crumbling empire.
The recent success of EI is built on Trans Atlantic connections, a huge chunk of which is from the UK regions. IAG, particularly BA must have been looking on for the last 2 years or so with annoyance. Putting a stop to that before it becomes a true threat combined with 24 LHR slot pairs a day pays for itself in the long run from their point of view
The recent success of EI is built on Trans Atlantic connections, a huge chunk of which is from the UK regions. IAG, particularly BA must have been looking on for the last 2 years or so with annoyance. Putting a stop to that before it becomes a true threat combined with 24 LHR slot pairs a day pays for itself in the long run from their point of view
Join Date: May 2007
Location: Ireland
Posts: 175
Likes: 0
Received 0 Likes
on
0 Posts
The recent success of EI is built on Trans Atlantic connections, a huge chunk of which is from the UK regions. IAG, particularly BA must have been looking on for the last 2 years or so with annoyance. Putting a stop to that before it becomes a true threat combined with 24 LHR slot pairs a day pays for itself in the long run from their point of view
That said, the offer may be more a strategic attempt to warn off the airline that may not be mentioned on Pprune....
Join Date: Apr 2009
Location: UK
Posts: 489
Likes: 0
Received 0 Likes
on
0 Posts
There are actually loads of permutations....here are some random thoughts in no particular order...
- AL flies 330/350 wide bodies on lhr route at peak times only releasing slots for BA longhaul
- AL feeds into LHR and services UK regions for BA just as it has for Little Red. BA then turns a profit on regional due to the significantly low cost base which AL has
- AL takes over Lgw routes utilising it's lower cost base and again makes loads of profit
- Some BA or AL flagged aircraft fly lhr/dub then onto US utilising CBP facilities
- big cull of back office staff/middle management at AL as no longer needed once integrated into BA which in turn generates huge underlying profitability
- AL flies 330/350 wide bodies on lhr route at peak times only releasing slots for BA longhaul
- AL feeds into LHR and services UK regions for BA just as it has for Little Red. BA then turns a profit on regional due to the significantly low cost base which AL has
- AL takes over Lgw routes utilising it's lower cost base and again makes loads of profit
- Some BA or AL flagged aircraft fly lhr/dub then onto US utilising CBP facilities
- big cull of back office staff/middle management at AL as no longer needed once integrated into BA which in turn generates huge underlying profitability
Join Date: Dec 2003
Location: uk
Posts: 1,578
Likes: 0
Received 0 Likes
on
0 Posts
The recent success of EI is built on Trans Atlantic connections, a huge chunk of which is from the UK regions
BA only serve 6 UK airports now...
PS less than half that served from Manchester
PPS If you have a half empty 777 coming in from JFK and say 4 pax or 5 tfr to Stavanger or Gothenburg maybe its time to worry !
BA only serve 6 UK airports now...
PS less than half that served from Manchester
PPS If you have a half empty 777 coming in from JFK and say 4 pax or 5 tfr to Stavanger or Gothenburg maybe its time to worry !
Join Date: Jun 2011
Location: London, UK & Europe
Posts: 2
Likes: 0
Received 0 Likes
on
0 Posts
There are actually loads of permutations....here are some random thoughts in no particular order...
- AL flies 330/350 wide bodies on lhr route at peak times only releasing slots for BA longhaul
- AL feeds into LHR and services UK regions for BA just as it has for Little Red. BA then turns a profit on regional due to the significantly low cost base which AL has
- AL takes over Lgw routes utilising it's lower cost base and again makes loads of profit
- Some BA or AL flagged aircraft fly lhr/dub then onto US utilising CBP facilities
- big cull of back office staff/middle management at AL as no longer needed once integrated into BA which in turn generates huge underlying profitability
- AL flies 330/350 wide bodies on lhr route at peak times only releasing slots for BA longhaul
- AL feeds into LHR and services UK regions for BA just as it has for Little Red. BA then turns a profit on regional due to the significantly low cost base which AL has
- AL takes over Lgw routes utilising it's lower cost base and again makes loads of profit
- Some BA or AL flagged aircraft fly lhr/dub then onto US utilising CBP facilities
- big cull of back office staff/middle management at AL as no longer needed once integrated into BA which in turn generates huge underlying profitability
Vueling is part of the group so if LGW is such a problem they could take it over.
It will never happen and I am not even sure FR would support such a move.
Not sure they would like Aer Lingus and Vueling under the same management.
BA moving their LGW 777s to LHR to use EI's slots, EI doing BA's sun and fun routes from LGW with A330s/50s, with a few left in DUB for JFK, BOS and ORD, just like the 747 days. I think you've found a big motive of BA's MCDU!
Join Date: Dec 2011
Location: Middlesex (under the flightpath)
Posts: 1,946
Likes: 0
Received 0 Likes
on
0 Posts
There are actually loads of permutations....here are some random thoughts in no particular order...
- AL flies 330/350 wide bodies on lhr route at peak times only releasing slots for BA longhaul
- AL feeds into LHR and services UK regions for BA just as it has for Little Red. BA then turns a profit on regional due to the significantly low cost base which AL has
- AL takes over Lgw routes utilising it's lower cost base and again makes loads of profit
- Some BA or AL flagged aircraft fly lhr/dub then onto US utilising CBP facilities
- big cull of back office staff/middle management at AL as no longer needed once integrated into BA which in turn generates huge underlying profitability
- AL flies 330/350 wide bodies on lhr route at peak times only releasing slots for BA longhaul
- AL feeds into LHR and services UK regions for BA just as it has for Little Red. BA then turns a profit on regional due to the significantly low cost base which AL has
- AL takes over Lgw routes utilising it's lower cost base and again makes loads of profit
- Some BA or AL flagged aircraft fly lhr/dub then onto US utilising CBP facilities
- big cull of back office staff/middle management at AL as no longer needed once integrated into BA which in turn generates huge underlying profitability
Isn't EI partly owned by its employees?
BA only serve 6 UK airports now...
BA could fly their wide bodies to LHR at peak times and make better use of their slots but the simple fact when they are beginning flights to Greek islands it shows they have way to many slots currently.
Apparently the split of the acquired BD slots was going to be one-third longhaul/two thirds shorthaul, but there is, allegedly, a shortage of suitable longhaul aircraft. There may be a few more slots (9 slot pairs?) coming down the line from VS in 2015.
Having seen the asset-stripping of BD slots by LH from the sidelines before 2012, acquiring EI may have more to do with preventing the same being done to EI by another carrier rather than BA doing it.
Last edited by Fairdealfrank; 19th Dec 2014 at 01:13.
Join Date: May 2007
Location: Ireland
Posts: 175
Likes: 0
Received 0 Likes
on
0 Posts
11 UK airports: ABZ, BHD, EDI, GLA, JER, LBA, LCY, LGW, LHR, MAN, NCL.
Join Date: Dec 2003
Location: uk
Posts: 1,578
Likes: 0
Received 0 Likes
on
0 Posts
They only connect to 6 .....from Heathrow !
Manchester, Leeds, Newcastle, Glasgow , Edinburgh and Aberdeen.
My point was very much about BA connectivity from the UK regions to Heathrow !
(...thats of course when its not foggy, snowing or somebody forgets to put a shilling in the meter at Swanwick)
Manchester, Leeds, Newcastle, Glasgow , Edinburgh and Aberdeen.
My point was very much about BA connectivity from the UK regions to Heathrow !
(...thats of course when its not foggy, snowing or somebody forgets to put a shilling in the meter at Swanwick)
If (and it would seem unlikely) IAG were to be able to acquire Aer lingus, and retain all those LHR slots, then I guess is they'd slim down the Dublin transatlantic operation, and use the newly acquired LHR slots to add yet more capacity to the London / USA routes. I can also see BA using EI as a feeder operation to their LHR hub mainly, and cutting down massively on direct DUB - mainland Europe destinations, treating Dublin as it does Manchester, Glasgow and Edinburgh.
This would not result in UK regional passengers trudging down to LHR to fly with BA, but surely to drive more regional PAX into the hands of KL / LH and of course Icelandair.
However, I really can't see the UK or EU competition authorities allowing IAG to get away with retaining all of the EI slots at LHR were any such takeover to go ahead and I can't see the Irish government being overjoyed with potentially losing their "national flag carrier" and perhaps direct services to their main (EU) trading markets.
This would not result in UK regional passengers trudging down to LHR to fly with BA, but surely to drive more regional PAX into the hands of KL / LH and of course Icelandair.
However, I really can't see the UK or EU competition authorities allowing IAG to get away with retaining all of the EI slots at LHR were any such takeover to go ahead and I can't see the Irish government being overjoyed with potentially losing their "national flag carrier" and perhaps direct services to their main (EU) trading markets.
Join Date: Nov 2006
Location: Northern Ireland
Posts: 2,781
Likes: 0
Received 0 Likes
on
0 Posts
ATNotts
I can also see BA using EI as a feeder operation to their LHR hub mainly, and
cutting down massively on direct DUB - mainland Europe destinations, treating
Dublin as it does Manchester,
Dublin has a bouyant market. If BA opted to channel traffic via London, which I cannot see, the likes of LH would step up FRA, and other carriers would step in, FR would just expand. Lets not forget Willie Walsh will be keep to see AerLingus prosper and grow.
I am see this move by BA as very positive indeed. WW has always said that they wouldn't touch it until the pension position was under control. So that may be in sight!
EI-BUD
I can also see BA using EI as a feeder operation to their LHR hub mainly, and
cutting down massively on direct DUB - mainland Europe destinations, treating
Dublin as it does Manchester,
I am see this move by BA as very positive indeed. WW has always said that they wouldn't touch it until the pension position was under control. So that may be in sight!
EI-BUD